Concerned About “Due Diligence” on Govt’s GB Power Company Deal

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GRAND BAHAMA –

Ralph Hepburn – President, Grand Bahama Chamber of Commerce

“The concern for most businesses, especially us at the Chamber, is due diligence. Our thing is, whenever you go into purchasing any entity, there’s a process called due diligence, and everything should be laid on the table as to the assets and the liabilities and the outstanding obligations, creditors and debts owed by a company.”

Grand Bahama Chamber of Commerce President Ralph Hepburn reacted to news that the Davis administration is moving to restructure more than $331 million in debt tied to the Grand Bahama Power Company, following its agreement earlier this year to acquire the utility company from Emera.

In Parliament on Wednesday, Minister of Finance Michael Halkitis confirmed the move.

The $331 million figure includes more than $200 million in borrowing previously approved by Parliament to facilitate the acquisition, along with approximately $132 million in the company’s existing loan facilities.

Halkitis says the refinancing is intended to reduce annual debt-servicing costs, provide greater certainty in meeting interest payments and reduce the risks associated with having to refinance existing loans.

The government also says the move would strengthen GBPC’s financial position and support the continued operation and orderly development of Grand Bahama’s electricity infrastructure.

News of the increased borrowing is not sitting well with Free National Movement Chairman Dr. Duane Sands, who criticized the Davis administration over its decision.

While he stopped short of criticizing the acquisition itself, Hepburn acknowledged that the increase in borrowing adds to the financial strain.

Ralph Hepburn – President, Grand Bahama Chamber of Commerce

“We’re wondering, was there a thorough process done by the government before the purchase, or is it something they were just being allowed to bring forth now to go back and look for additional funding, which, from a business point of view, does not look well.”

While the government says the refinancing could help lower annual debt costs and manage financial risks, the overall impact will depend on the terms of the new financing and the savings ultimately achieved.

For now, officials say the proposed refinancing represents another major step in the government’s effort to bring Grand Bahama Power Company’s debt obligations into its broader financial strategy.